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RUEHOT/AMEMBASSY OTTAWA 0532
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RHMFIUU/DEPT OF ENERGY WASHINGTON DC
RUEHHA/AMCONSUL HALIFAX 1382

UNCLAS SECTION 01 OF 08 HALIFAX 000045 
 
SIPDIS 
 
STATE FOR WHA/CAN, EB/ESC/ISC 
USDOE FOR IA (DEUTSCH) 
 
E.O. 12958: N/A 
TAGS: EPET ENRG PGOV CA
SUBJECT: ENERGY PROJECTS IN ATLANTIC CANADA - FACTS AND FIGURES 
 
REF: 03 HALIFAX 0203 (NOTAL) 
 
HALIFAX 00000045  001.2 OF 008 
 
 
===================== 
INTRODUCTION/SUMMARY: 
===================== 
 
¶1.  This cable is a "primer" on the status of significant 
operating and future energy projects in Atlantic Canada.  The 
Atlantic Provinces Economic Council (APEC), a regional think 
tank, reported in March 2008 that actual and proposed new 
investment in these projects had reached the level of $42 
billion.  Unlike the 1990s, however, today's investments are 
focused less on offshore developments and more on a mixture of 
onshore projects such as Liquefied Natural Gas (LNG) facilities, 
oil refineries, pipelines, hydro and nuclear power generation, 
and other forms of renewable energy.  What has not changed over 
the years is the overarching importance of the U.S. northeast 
energy market.  New England is the market for approximately 85 
percent of Atlantic Canada's international energy exports, which 
totaled $16.6 billion in 2007. (The remaining 15 percent is 
divided among a number of other countries, none of which would 
be considered a prime secondary market.)  Future demand in New 
England is also the driving force behind several new and 
proposed energy projects throughout the region. 
 
¶2.  The contents of this cable are structured as follows: 
 
¶I.  Oil and gas 
  ¶A.  Offshore oil and gas projects 
    ¶1.  Hibernia 
    ¶2.  Terra Nova 
    ¶3.  White Rose 
    ¶4.  Hebron 
    ¶5.  Sable 
    ¶6.  Deep Panuke 
 
  ¶B.  Onshore gas projects 
    ¶1.  McCully Field 
    ¶2.  Stealth Venture 
    ¶3.  Alton Natural Gas Storage 
 
  ¶C.  LNG projects 
    ¶1.  Canaport LNG 
    ¶2.  MapleLNG 
    ¶3.  Grassy Point LNG 
 
  ¶D.  Pipelines 
    ¶1.  Maritimes and Northeast Pipeline 
    ¶2.  Brunswick Pipeline 
 
  ¶E.  Refineries 
    ¶1.  Irving Refinery 
    ¶2.  Eider Rock (2nd Irving Refinery) 
    ¶3.  North Atlantic Refinery 
    ¶4.  Newfoundland and Labrador Refinery 
 
II.  Hydroelectric Power 
  ¶A.  Upper Churchill 
  ¶B.  Lower Churchill) 
 
III.  Nuclear Power 
  ¶A.  Point Lepreau 
  ¶B.  Point Lepreau Two 
 
IV.  Other Projects 
  ¶A.  New Brunswick International Power Line 
  ¶B.  Renewable Energy Projects 
 
END INTRODUCTION/SUMMARY 
 
=============== 
¶I.  Oil and Gas 
=============== 
 
  ¶A.  Offshore Oil and Gas Projects 
  --------------------------------- 
 
    ¶1.  HIBERNIA 
 
        --Type:  Offshore Oil 
        --Location:  Newfoundland-Labrador; 195 miles 
east-southeast of St. John's 
        --Owner/Operator:  Owned jointly by ExxonMobil Canada 
(33.125%), Chevron Canada Resources (26.875%), Petro-Canada 
(20%), Canada Hibernia Holding Corporation (8.5%), Murphy Oil 
(6.5%) and StatoilHydro Canada Ltd (5%).  Operator:  ExxonMobil 
        --Status:  Producing/Complete 
        --Start-up Date: Producing since November 1997 
        --Estimated Reserves:  Reserves of 3 billion barrels; 865 
 
HALIFAX 00000045  002.2 OF 008 
 
 
million barrels recoverable reserves 
        --Production:  140,000 to 150,000 barrels per day 
        --Details:  Discovered in 1979, Hibernia is the largest 
oil field offshore Newfoundland-Labrador and the first to be 
developed.  The production facilities feature a Gravity Based 
Structure (GBS), topsides and offshore loading system. 
        --Web Address:  http://www.hibernia.ca 
        --Latest Developments:  A proposed expansion at South 
Hibernia would add as much as 300 million barrels to the 
recoverable reserves.  The Hibernia partners expect to start the 
expansion project in 2009-2010. 
 
    ¶2.  TERRA NOVA 
 
        --Type:  Offshore Oil 
        --Location:  Newfoundland-Labrador; 217 miles 
east-southeast of St. John's 
        --Owner/Operator:  Owners: Petro-Canada (33.99%), 
ExxonMobil Canada (22%), Norsk Hydro Canada Oil & Gas (15%), 
Husky Oil (12.51%), Murphy Oil (12%), Mosbacher Operating Ltd. 
(3.5%) and Chevron Canada Resources (1%)  Operator:  Petro-Canada 
        --Status:  Producing/Complete 
        --Start-up Date: Producing since January 2002 
        --Estimated Reserves:  370 million barrels recoverable 
reserves 
        --Production:  140,000 barrels per day 
        --Details:  Discovered in 1984, Terra Nova is the second 
largest field offshore Canada's East Coast and the second to be 
developed.  Unlike Hibernia, Terra Nova uses a Floating 
Production Storage and Offloading (FPSO) vessel system. 
        --Web Address: 
        http://www.petro-canada.ca/en/about/721.aspx 
        --Latest Developments:  Petro-Canada will shut down 
production at Terra Nova for a scheduled 16-day maintenance 
program the last half of June 2008.  In 2007, the project had 
been plagued by minor problems, including two week-long 
shutdowns in October and December for repairs. 
 
    ¶3.  WHITE ROSE 
 
        --Type:  Offshore Oil 
        --Location:  Newfoundland-Labrador; 217 miles 
east-southeast of St. John's 
        --Owner/Operator:  Owners:  Husky Energy (72.5%); 
Petro-Canada (27.5%)  Operator:  Husky Energy 
        --Status:  Producing/Complete 
        --Start-up Date: Producing since November 2005 
        --Estimated Reserves:  200-250 million barrels recoverable 
reserves 
        --Production:  100,000 barrels per day 
        --Details:  Discovered in 1984, White Rose is the third 
largest field offshore Canada's East Coast and the third to be 
developed.  Like Terra Nova it uses a purpose-built 
floating-production, storage and offloading (FPSO) vessel and a 
subsea production system. 
        --Web Address:  http://www.huskyenergy.ca/operations/ 
        canadaseastcoast/projects/whiterose.asp 
        --Latest Developments:  Husky's future plans for White 
Rose include developing satellite fields that should start 
producing by late 2009. 
 
    ¶4.  HEBRON 
 
        --Type:  Offshore Oil 
        --Location:  Newfoundland-Labrador; 217 miles 
east-southeast of St. John's 
        --Owner/Operator:  Owners:  Chevron Canada Resources 
(28%), ExxonMobil Canada (38%), Petro-Canada (24%) and Norsk 
Hydro Canada Oil & Gas (10%)  Operator:  Chevron Canada Resources 
        --Status:  Planned/Proposed 
        --Start-up Date: Undetermined 
        --Estimated Reserves:  400-700 million barrels 
        --Production:  150,000 to 170,000 barrels of oil per day 
        --Cost:  $7 billion-$11 billion 
        --Details:  Discovered in 1981, Hebron has the potential 
to become Newfoundland-Labrador's fourth offshore oil 
development and the project could also include development of 
the nearby Ben Nevis and West Ben Nevis fields.  Like Hibernia, 
the partners would use a Gravity Base Structure (GBS) to develop 
the project. 
        --Web Address:  http://www.chevron.ca/operations/ 
        exploration/atlantic.asp 
        --Latest Developments:  In August 2007, the project 
partners signed a Memorandum of Understanding (MOU) on fiscal 
and local benefits with the Government of Newfoundland and 
Labrador. The MOU forms the basis for future formal agreements 
on fiscal, equity and local benefits terms for a potential 
development project.  As of June 2008, the parties had not 
 
HALIFAX 00000045  003.2 OF 008 
 
 
reached agreement on any of these issues. 
 
    ¶5.  SABLE OFFSHORE ENERGY PROJECT 
 
        --Type:  Offshore Natural Gas 
        --Location:  Nova Scotia; 124 miles off Halifax 
        --Owner/Operator:  Owners:  ExxonMobil Canada (50.8%), 
Shell Canada (31.3%), Imperial Oil Resources (9%), Pengrowth 
Corp. (8.4%) and Mosbacher Operating Limited (0.5%)  Operator: 
ExxonMobil Canada 
        --Status:  Producing/Complete 
        --Start-up Date: December 1999 
        --Estimated Reserves:  3 Trillion Cubic Feet 
        --Production:  425 million cubic feet per day and 20,000 
barrels of associated condensate and natural gas liquids 
        --Details:  The Sable Offshore Energy Project is divided 
into two tiers of offshore development. The first tier was 
completed in December 1999 and involved the development of the 
Thebaud, North Triumph, and Venture fields, as well as the 
construction of three offshore platforms, an onshore gas plant 
and an onshore fractionation plant. Tier II fields are Alma, 
South Venture and Glenelg. Alma began production in November 
2003 followed by South Venture in December 2004. ExxonMobil and 
its partners are presently reviewing the future of the Glenelg 
field. 
        --Web Address:  http://www.soep.com 
        --Latest Developments:  With the completion of a 
compression platform in 2007, the Sable development plan is now 
complete and the project owners are now focused on optimizing 
production. 
 
    ¶6.  DEEP PANUKE 
 
        --Type:  Offshore Natural Gas 
        --Location:  Nova Scotia; 155 miles southeast of Halifax 
        --Owner/Operator:  EnCana Corporation of Calgary, Alberta 
        --Status:  Approved/Under Construction 
        --Start-up Date: 2010 (target) 
        --Estimated Reserves:  630 billion cubic feet 
        --Production:  300 million cubic feet of gas per day 
        --Cost:  $700 Million 
        --Details:  Discovered in 1998, the economics of 
developing Deep Panuke were not proven until 2007 when EnCana's 
Board of Directors gave the project the go-ahead and after they 
had received regulatory approval.  The development plan calls 
for the use of jack-up mobile offshore production unit, subsea 
flow lines and wells, and an export pipeline. 
        --Web Address:  http://www.encana.com/operations/ 
        canada/deeppanuke/index.htm 
        --Latest Developments:  The project is currently in the 
tendering/pre-construction phase. 
 
  ¶B.  Onshore Gas Projects 
  ------------------------ 
 
    ¶1.  MCCULLY FIELD 
 
        --Type:  Onshore Natural Gas 
        --Location:  New Brunswick; near Sussex 
        --Owner/Operator:  Corridor Resources, a junior resource 
company based in Halifax 
        --Status:  Producing/Complete 
        --Start-up Date: Operating since June 2007 
        --Estimated Reserves:  A proven plus probable gas-in-place 
(50% probability) of 722 billion cubic feet 
        --Production:  35 million cubic feet per day 
        --Details:  This project consists of a field gathering 
system, a gas plant, and a pipeline lateral. In June 2007, 
Corridor began supplying McCully natural gas to markets in the 
Maritimes and the Northeastern United States via the Maritimes & 
Northeast Pipeline. 
        --Web Address: 
http://www.corridor.ca/operations/mccully-fie ld.html 
        --Latest Developments:  The company intends to drill eight 
new development wells and one exploration well in 2008. 
 
    ¶2.  STEALTH VENTURES 
 
        --Type:  Onshore; coal-bed methane (natural gas from coal) 
        --Location:  Nova Scotia; abandoned coal mines in 
Springhill, Cumberland County. 
        --Owner/Operator:  Stealth Ventures of Calgary, Alberta 
        --Status:  Planned/Proposed 
        --Start-up Date: Undetermined 
        --Estimated Reserves:  Estimated to contain 1.2 trillion 
cubic feet of coal gas 
        --Production:  Undetermined 
        --Cost:  $10 million to date for exploration work 
 
HALIFAX 00000045  004.2 OF 008 
 
 
        --Details:  Stealth has been exploring in the Springhill 
area since 2005 and has drilled three test wells. This project 
will be the province's first onshore gas development and 
intended markets are in the U.S. northeast and in Nova Scotia. 
        --Web Address:  http://www.stealthventures.ca/ 
        --Latest Developments:  Further testing and feasibility 
studies are underway. 
 
    ¶3.  ALTON NATURAL GAS STORAGE 
 
        --Type:  Onshore Storage 
        --Location:  Nova Scotia; located in Alton, 30 miles north 
of Halifax 
        --Owner/Operator:  Owned by Fort Chicago Energy Partners 
of Calgary, Alberta (50%) and L.P. and Landis Energy Corporation 
also of Calgary, Alberta (50%) 
        --Status:  Approved/Under construction 
        --Start-up Date: 2012 
        --Production:  Initial capacity will be four to six BCF of 
natural gas in four caverns, with a projected capacity of over 
50 BCF. 
        --Cost:  To be determined 
        --Details:  This project involves building an underground 
natural gas storage facility consisting of an initial 4 caverns 
with the capability of storing over 4 billion cubic feet (BCF) 
of natural gas. An additional 10 to 15 caverns could also be 
developed. The development plan calls for a lateral line to be 
built to the Maritimes and Northeast pipeline.  The supplies of 
natural gas would come from either offshore, onshore or LNG 
facilities. 
        --Web Address:  http://www.altongas.com/ 
        --Latest Developments:  On December 18, 2007, the project 
received regulatory approval.  The developers have already 
completed pre-construction work and the majority of the detailed 
engineering and surveying requirements 
 
  ¶C.  LNG PROJECTS 
  ---------------- 
 
    ¶1.  CANAPORT LNG 
 
        --Location:  New Brunswick; Saint John 
        --Owner/Operator:  Canaport LNG is a partnership between 
Irving Oil of New Brunswick (25%) and Repsol YPF of Spain (75%). 
        --Status:  Approved/Under Construction 
        --Start-up Date: End of 2008 
        --Production:  1 BCF a day of natural gas 
        --Cost:  $800 million 
        --Details:  When completed in late 2008, Canaport LNG will 
become the first LNG degasification plant in Canada, supplying 
natural gas to Canadian and American markets.  The facility will 
have three, 160,000 cubic meter LNG storage tanks at start-up, 
but could be expanded to five.  Gas will be transported to 
market via the Emera-owned Brunswick pipeline, which will 
connect with the Maritimes and Northeast Pipeline at the New 
Brunswick-Maine border. 
        --Web Address:  http://www.canaportlng.com 
        --Latest Developments:  The overall project status is 76% 
complete (99% complete for offshore and 70% complete for 
onshore.) 
 
    ¶2.  MAPLELNG 
 
        --Category:  Oil/Gas 
        --Location:  Nova Scotia; Goldboro in Guysborough County 
        --Owner/Operator:  MapleLNG is a Nova Scotia company and 
the Canadian subsidiary of 4Gas and Suntera. 4Gas is an 
independent company located in Rotterdam; Suntera is an 
international energy company with oil and gas assets in West 
Africa, North America and India. 
        --Status:  Planned/Proposed 
        --Start-up Date: 2011 
        --Production:  1 billion cubic feet of gas per day. 
        --Cost:  $700 million 
        --Details:  The project calls for a marine terminal 
designed to handle LNG carriers with capacities ranging from 
75,000 cubic meters to 250,000 cubic meters, three storage 
tanks, and regasification facilities.  The terminal will be 
located adjacent to the Maritimes and Northeast Pipeline intake 
station at the Sable Offshore Energy Gas Plant in Goldboro. Gas 
would be transported to market via the Maritimes and Northeast 
Pipeline. 
        --Web Address:  http://www.maplelng.com 
        --Latest Developments:  The project developers are 
currently waiting for federal environmental approval although 
the developers are still looking for a supplier. 
 
    ¶3.  GRASSY PT. LNG TRANSSHIPMENT AND STORAGE TERMINAL 
 
HALIFAX 00000045  005.2 OF 008 
 
 
 
        --Location:  Newfoundland-Labrador; Grassy Point, 
Come-by-Chance Harbour, Placentia Bay 
        --Owner/Operator:  Newfoundland LNG Ltd., a 
Newfoundland-Labrador company, jointly owned by North Atlantic 
Pipeline Partners, LP (50%) and LNG Partners, LLC (50%), 
        --Status:  Planned/Proposed 
        --Start-up Date: December 2010 
        --Production:  Three jetties will have berthing capability 
for LNG tankers up to 265,000 cubic meters and eight LNG storage 
tanks 
        --Cost:  $1 billion 
        --Details:  Intended markets are the U.S. and Atlantic 
Canada.  When complete, the project will provide facilities for 
the following services: LNG cargo transfer, short and long-term 
storage of LNG, temporary vessel-based LNG storage and a lay-up 
site for in-transit LNG carriers 
        --Web Address:  http://www.lngpartners.com 
        --Latest Developments:  The project has passed the 
provincial regulatory process and is currently undergoing a 
federal assessment. 
 
  ¶D. Pipelines 
  ------------ 
 
    ¶1.  MARITIMES & NORTHEAST PIPELINE 
 
        --Location:  Offshore Nova Scotia to Dracut Massachusetts 
        --Owner/Operator:  A joint venture of Spectra Energy 
(77.53%), Emera Inc. (12.92%), and ExxonMobil Canada (9.55%) 
        --Status:  Producing/Completed 
        --Start-up Date: Operating since 1999 
        --Production:  System capacity is approximately 530 
million cubic feet per day. 
        --Details:  Maritimes & Northeast Pipeline (M&NP) is an 
860-mile transmission pipeline system built in 1999 to transport 
natural gas from developments offshore Nova Scotia to markets in 
Atlantic Canada and the northeastern United States.  The M&NP 
system consists of a 30"/24" mainline that runs from the Sable 
Offshore Energy Inc. (SOEI) gas plant at landfall in Goldboro, 
through Nova Scotia, New Brunswick, Maine, New Hampshire, and 
Massachusetts. The mainline interconnects with Portland Natural 
Gas Transmission System, Tennessee Gas Transmission, and 
Algonquin Gas Transmission. Through lateral pipelines M&NP 
serves Canadian markets in Nova Scotia and New Brunswick. 
        --Web Address:  http://www.mnpp.com/canada/index.html 
        --Latest Developments:  With its project now well 
established, the partners in M&NP are looking at new joint 
ventures with other regional energy developers. 
 
    ¶2.  BRUNSWICK PIPELINE 
 
        --Location:  from the Canaport LNG terminal in Saint John, 
to the existing Maritimes & Northeast Pipeline near St. Stephen, 
NB. 
        --Owner/Operator:  Owned by Emera Inc of Halifax, Nova 
Scotia, the parent company of Nova Scotia Power. Emera has 
contracted with Spectra Energy to carry out the permitting, 
design, construction and operation of the pipeline. 
        --Status:  Approved/Under construction 
        --Start-up Date: November 2008 
        --Production:  850 million cubic feet per day of 
re-gasified LNG. 
        --Cost:  $465 million 
        --Details:  Brunswick Pipeline is a 30-inch diameter, 
90-mile pipeline which will connect the Canaport LNG terminal in 
Saint John, to the existing Maritimes & Northeast Pipeline. 
        --Web Address:  http://www.brunswickpipeline.com 
        --Latest Developments:  This project is under construction 
and nearing completion although there are cost overrun issues. 
In May 2008 the project managers revealed that the cost of the 
project has increased from the forecasted $350 million to $465 
due to higher than anticipated material and construction costs. 
 
  ¶E.  Refineries 
  -------------- 
 
    ¶1.  IRVING REFINERY 
 
        --Location:  Saint John, New Brunswick 
        --Owner/Operator:  Irving Oil of Saint John, New Brunswick 
        --Status:  Producing/Complete 
        --Start-up Date: Operating since 1960 
        --Production:  300,000 barrels per day 
        --Details:  The Irving refinery in Saint John is Canada's 
largest, producing over 300,000 barrels of energy products per 
day.  From that daily production, the company exports the 
majority to the U.S. Northeast and ultra-low sulfur fuels to 
 
HALIFAX 00000045  006.2 OF 008 
 
 
California to meet that state's emissions standards. 
        --Web Address: 
        http://www.irvingoil.com/company/refinery.asp 
        --Latest Developments:  Irving is contemplating building a 
new refinery (the Eider Rock Project) adjacent to the existing 
facility. 
 
    ¶2.  EIDER ROCK REFINERY (SECOND IRVING REFINERY) 
 
        --Location:  New Brunswick; Saint John 
        --Owner/Operator:  Irving Oil of Saint John, New Brunswick 
        --Status:  Planned/Proposed 
        --Start-up Date: 2015 
        --Production:  300,000 barrels per day 
        --Cost:  $7 Billion 
        --Details:  This proposed refinery would be built 
alongside Irving's existing 300,000 barrel-per-day refinery and 
near the Irving Canaport crude oil terminal. 
        --Web Address:  http://www.irvingoil.com/company/erock.asp 
        --Latest Developments:  In March 2008, Irving Oil entered 
into a Memorandum of Understanding with BP which will see BP 
contribute $40 million toward the engineering, design and 
feasibility for the project.  The two companies will also 
investigate the possibility of forming a joint venture to build 
the facility although a final decision is not expected before 
¶2009.  If the parties proceed and obtain regulatory approval, 
construction could start in 2010 and be finished by 2015. 
 
    ¶3.  NORTH ATLANTIC REFINERY 
 
        --Location:  Newfoundland-Labrador; Come-by-Chance, 
Placentia Bay 
        --Owner/Operator:  Owned and operated by North Atlantic 
Refining, a subsidiary of Harvest Energy Trust of Calgary, 
Alberta 
        --Status:  Producing/Complete 
        --Start-up Date: Operating since 1996 
        --Production:  115,000 barrels per day 
        --Details:  Operating since 1996, North Atlantic Refinery 
produces gasoline, ultra low sulfur diesel and jet fuel.  The 
majority of the products are exported to the United States.  The 
company also operates 69 gas stations and a home heating 
business and also supplies numerous commercial clients in 
Newfoundland-Labrador. 
        --Web Address:  http://northatlantic.ca 
        --Latest Developments:  The NAR is one of the entities 
operating in the Placentia Bay industrial area, which also 
includes a transshipment facility at Whiffen Head for offshore 
oil and a construction facility at Bull Arm.  It would also be 
the site for a future second refinery being proposed by 
Newfoundland and Labrador Refinery Corporation. 
 
    ¶4.  NEWFOUNDLAND AND LABRADOR REFINERY PROJECT 
 
        --Location:  Newfoundland-Labrador; Southern Head, 
Placentia Bay 
        --Owner/Operator:  Newfoundland and Labrador Refining 
Corporation which is owned by N-L based Altius Resources Inc. 
and private European entrepreneurs. 
        --Status:  Planned/Proposed 
        --Start-up Date: 2011 
        --Production:  300,000 barrels per day 
        --Cost:  $5 Billion 
        --Details:  The development plan calls for the facility to 
process heavy sour crude at the site, a deepwater, ice-free port 
near the province's existing oil industry infrastructure on 
Placentia Bay. 
        --Web Address:  http://www.nlrefining.com/ 
        --Latest Developments:  The federal government approved 
the development plan in April 2008.  However, the developers 
have not yet contracted with partners and lenders for the 
project. 
 
======================== 
II.  Hydroelectric Power 
======================== 
 
  ¶A. UPPER CHURCHILL 
  ------------------ 
 
        --Type:  Power Generation 
        --Location:  Newfoundland-Labrador; Churchill River, 
Labrador 
        --Owner/Operator:  The Churchill River Power Project is a 
joint initiative of the provinces of Newfoundland and Labrador 
and Quebec and their respective hydroelectric utilities, Hydro 
Quebec and Newfoundland and Labrador Hydro. 
        --Status:  Producing/Complete 
 
HALIFAX 00000045  007.2 OF 008 
 
 
        --Start-up Date: Operating since 1971 
        --Production:  5,428 MW 
        --Details:  The massive hydroelectric potential of the 
falls was realized for decades, but it was not until the 
completion of the Quebec, North Shore and Labrador Railway in 
1954 and the development of long-distance electric-power 
transmission technology by Hydro-Quebec that exploitation became 
feasible.  Complex development negotiations between the 
governments of Newfoundland and Quebec (through which the power 
would have to pass) were not completed until 1969. The project 
took nine years to build, employed more than 30,000 people and 
cost $950 million. The first units began transmitting December 
1971; the eleventh and final unit went into service in 1974. 
        --Web Address:  www.nlh.nl.ca 
        --Latest Developments:  The sales contract between the 
governments of Newfoundland-Labrador and Quebec for the 
Churchill power is a decades-long, contentious political issue. 
Under the terms of the contract, which does not expire until 
2041, the price that Quebec pays for the Churchill power is 
fixed at 1969 prices.  With the dramatic rise in energy costs 
over the years, Hydro-Quebec has reaped substantial profits from 
the resale of Churchill Falls power.  The Government of 
Newfoundland-Labrador has tried unsuccessfully to have the terms 
amended and this issue is a factor in the current negotiations 
over development of the Lower Churchill River. 
 
  ¶B.  LOWER CHURCHILL PROJECT 
  --------------------------- 
 
        --Location:  Newfoundland-Labrador; Churchill River, 
Labrador 
        --Owner/Operator:  Owned and managed by the Churchill 
Falls Corporation, 51% owned by the Government of 
Newfoundland-Labrador and 49% by the Government of Canada. 
        --Status:  Planned/Proposed 
        --Start-up Date: Undetermined 
        --Production:  2,800 megawatts of power (enough to power 
1.5 million homes) 
        --Cost:  $6-9 billion 
        --Details:  The existing 5,428 MW Churchill Falls 
generating station, which began producing power in 1971, 
harnesses about 65 per cent of the potential generating capacity 
of the Churchill River.  The remaining 35 per cent is located at 
two sites on the lower Churchill River, known as the Lower 
Churchill Project. These sites are considered two of the best 
undeveloped hydroelectric sites in North America: Gull Island, 
located 140 miles downstream from the existing Churchill Falls 
Generating Station; and Muskrat Falls, located 38 miles 
downstream from Gull Island. 
        --Web Address:  http://www.lowerchurchillproject.ca 
        --Latest Developments:  Should the project go ahead, there 
will be a nine-year construction period which would begin at 
Gull Island followed by first power five years later. 
Construction of the Muskrat Falls would be started three years 
after the start of the Gull Island construction.  A major 
decision that has yet to be made is how to transmit the power to 
market:  via an overland route through Quebec or via undersea 
cables to the Island of Newfoundland and through New Brunswick 
or Nova Scotia.  Environmental impacts and an agreement with the 
Innu Nation are other critical factors. 
 
=================== 
III.  Nuclear Power 
=================== 
 
  ¶A. POINT LEPREAU GENERATING STATION 
  ----------------------------------- 
 
        --Location:  New Brunswick; Point Lepreau 
        --Owner/Operator:  Owned and operated by the New Brunswick 
Power Nuclear Corporation, a subsidiary of the 
provincially-owned New Brunswick Power Corporation 
        --Status:  Shutdown for refit until September 2009 
        --Start-up Date: Operating since 1983 
        --Production:  capacity of 635 MW 
        --Details:  Point Lepreau has one nuclear reactor, a 
CANDU-6 unit, with net capacity of 635 MW. It was the first 
CANDU-6 to be licensed for operation and to begin commercial 
operation.  The unit supplies about 30% of the energy consumed 
in the province. 
        --Web Address:  http://nuclear.nbpower.com/en/default.aspx 
        --Latest Developments:  Point Lepreau is currently 
shutdown for a $1.4 billion refit, (with a September 2009 target 
for completion) which will extend the facility's life to 2032. 
 
  ¶B. 2ND LEPREAU STATION 
  ---------------------- 
 
 
HALIFAX 00000045  008.2 OF 008 
 
 
        --Location:  New Brunswick; Point Lepreau 
        --Owner/Operator:  The facility would be owned and 
operated by the New Brunswick Power Nuclear Corporation, a 
subsidiary of the provincially-owned New Brunswick Power 
Corporation. 
        --Status:  Under Consideration 
        --Start-up Date: Undetermined 
        --Production:  1,100 megawatts 
        --Cost:  $4-5 billion 
        --Details:  This project would involve building a new 
reactor to complement the existing reactor at the Point Lepreau 
site.  An independent consulting firm said in February 2008 that 
this project could be economically viable if the proponents 
could confirm domestic and U.S. markets.  However, LNG and 
natural gas generation facilities could be major competitors for 
a second plant. 
        --Web Address:  http://www.gnb.ca/0085/Lepreau-e.asp 
        --Latest Developments:  As of June 2008, the New Brunswick 
Provincial government had not made a final decision to proceed 
with the project. 
 
=================== 
IV.  Other Projects 
=================== 
 
  ¶A.  NEW BRUNSWICK-MAINE INTERNATIONAL POWER LINE 
  --------------------------------------------- --- 
 
        --Type:  Electricity Transmission 
        --Location:  Point Lepreau, New Brunswick to Orrington, 
Maine 
        --Owner/Operator:  A joint development between NB Power 
Transmission (a subsidiary of provincially-owned New Brunswick 
Power) and Bangor Hydro (a subsidiary of Emera of Halifax). 
        --Status:  Producing/Complete 
        --Start-up Date: Operating since December 2007 
        --Production:  345 Kilovolts 
        --Details:  This is the second international transmission 
line from New Brunswick to Maine. 
        --Web Address:  http://transmission.nbpower.com/en/ 
        intlpowerline/intlpowerline.aspx 
        --Latest Developments:  NB Power is involved in a dispute 
with New England utilities over tariffs on the line which has 
left the transmission line underutilized. 
 
¶B.      RENEWABLE ENERGY PROJECTS 
----------------------------- 
 
Tidal power is a growing area of interest in Nova Scotia and New 
Brunswick.  One Nova Scotia company, Minas Basin Pulp and Power, 
will be building a $12 million plant designed to harness the 
tides of the Bay of Fundy.  Three other separate groups will 
spend $12-15 million each testing their own tidal turbines at 
this facility, the results of which will be used to evaluate the 
potential for a full scale commercial tidal generating facility. 
 In other renewable energy projects, there are numerous wind 
farms throughout the region that are nearing completion over the 
next two-three years.  The average size is approximately 35 MW. 
FOSTER